Dissing the SEC's attempt to circumvent the Freedom of Information Act

The Chicago Tribune has published an editorial about the recent discovery of a loophole in the new financial securities regulation law that allows the Securities and Exchange Commission to avoid disclosing certain information under Freedom of Information Act requests.

The move concerns many business journalists, who feel it will inhibit their ability to cover the agency and financial firms.

The editorial states, “SEC Chairwoman Mary Schapiro told Congress that her agency needed the broad exemption to gather confidential business data from industry insiders who otherwise would fear that trade secrets would be spilled. She said the new law was not designed to avoid public accountability.

“Don’t buy it. The new language is not narrowly tailored to protect legitimate trade secrets. It gives big cover for an agency that has a track record of failure in its regulatory efforts.

“Case in point: Fox Business Network brought a suit against the SEC that seeks internal agency documents about its botched investigations of Bernard Madoff and Allen Stanford. Fox isn’t after trade secrets. It’s trying to get to the heart of the work done by the SEC.

“Shortly after President Obama signed the new financial regulation law, the SEC announced that it may invoke the FOIA protections to fend off the suit from Fox.”

Read more here.